Bloomberg Businessweek has an excellent story about Daniel Zhang, who today becomes the first person other than Jack Ma to hold the title of chairman and CEO at Alibaba Group Holding, the global e-commerce platform. Ma is stepping away from the company, and Zhang is his hand-picked successor … and here is perhaps the most important passage from the story:

“Zhang is proving as radical as his predecessor. He says Alibaba is uniquely positioned to pull together the online and offline worlds in groceries and beyond, and dozens of his new initiatives are leading Alibaba deeper into fields including finance, health care, movies, and music. Especially in the U.S., where the company’s shares trade, these efforts have baffled some investors, who worry about overreach.

“In Zhang’s view, they’re a matter of survival. ‘Every business has a life cycle,’ he says during an exclusive interview at Alibaba’s Hangzhou headquarters. ‘If we don’t kill our existing business, someone else will. So I’d rather see our own new businesses kill our existing business’.”

One example of Zhang’s thinking: He “wanted to launch a startup inside the e-commerce giant that would combine a grocery store, a restaurant, and a delivery app, using robotics and facial recognition to speed up logistics and payment.

“That project, Freshippo, has since become a major part of Zhang’s blueprint for Alibaba’s future, with 150 stores (and counting) across 17 Chinese cities. On a recent weekday afternoon at a store in Hangzhou, plastic bins shuttle automatically along tracks in the ceiling, collecting goods from around the store for online orders. Deliverymen stand by to transport the goods anywhere within a 1.9-mile radius in as little as 30 minutes.”

You can read the story here.

KC's View: It is interesting - and a little scary - that Zhang and Alibaba seem so at ease with the notion of killing off legacy businesses as the company moves into the future. Zhang understands that if you don’t disrupt your existing businesses from the inside, someone else will from the outside … and that person is a competitor.

Alibaba certainly has its challenges. Not every business is profitable, there are strains around the edges, and the Chinese economy is not what it was. But I always think that companies willing to push the envelope and challenge themselves are far better positioned to survive and thrive than those that stand pat. (By the way, it was Zhang’s team at Alibaba that came up with its fabulously successful Singles Day promotion. So there’s that…)